Trump's media company valued at almost $8 billion in strong Wall St debut

Shares of Donald Trump's Trump Media & Technology Group surged as much as 59 per cent on Tuesday in their Nasdaq debut, lifted by the former US president's supporters and providing him a potential windfall as he grapples with the costs of several legal cases.

At its session high of $79.38 per share, TMTG's market capitalisation crossed $10 billion on an undiluted basis, an astronomical valuation for a company that reported an operating loss of $10.6 million for the first nine months of 2023 on revenue of just $3.4 million.

The stock closed 16 per cent higher at $57.99, valuing the company at nearly $8 billion.

Trump's majority stake in TMTG was last valued at about $6 billion, although lock-up restrictions for six months could prevent him from selling or borrowing against his shareholding.

TMTG's stock market debut follows its merger with blank-check company Digital World Acquisition Corp that was announced in 2021 but suffered setbacks and delays.

Digital World and the newly listed TMTG have together surged almost 600 per cent since the deal was announced, cementing TMTG's status as one of Wall Street's so-called meme stocks popular among retail traders and whose movement can be driven by posts on social media.

"The valuation of the business is rich relative to its underlying fundamentals, but I would not get in front of it in the near term," said Thomas Hayes, chairman of Great Hill Capital.

"This valuation may be more of a proxy on the enthusiasm of supporters for Trump than a reasonable estimate of underlying business prospects."

Trading in the shares under the new ticker "DJT" was briefly halted just after the opening bell due to volatility.

Retail trader-focused social media and trading platform Stocktwits listed it as the most trending stock.

Shares of Digital World Acquisition Corp, which is now TMTG, had surged more than 35 per cent on Monday after completing its merger.